Home Loan FAQs

Home Loan FAQs

Professionals Finance deal with questions in all shapes and sizes every day. Because we’re here to help you on your property journey, we’ve put together the 10 most common home loan questions clients have.

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Also known as your borrowing capacity or borrowing power, the amount you can borrow depends on a number of factors. This will include your income, your assets and any other debt or financial commitments you have. Your borrowing capacity will often differ from lender to lender, so it’s best to engage a broker who can provide an individual assessment of your situation. To check your Borrowing Power, click here.

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That’s where we come in! We’ll do the legwork for you. We have access to hundreds of loans from a wide variety of lenders and will work with you to find the loan which suits your home loan needs.

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The time taken to process your home loan with Professionals Finance is dependent on a number of factors, which generally includes:

● Requirement of a valuation
● Complexity of your loan
● Availability of supporting documents i.e. your payslips, credit card statements etc.
● How quickly you return your signed loan documents.

Some loans are more complex than others and may take longer such as loans involving trusts, companies or guarantors – in these cases you’ll normally receive your loan documents within 4-7 business days.

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Check out our document checklist to see what most lenders require when lodging your home loan application.

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With Professionals Finance, there are 6 easy steps involved in your home loan process.

1. PRE-QUALIFY
We’ll help you determine how much you can borrow

2. APPLICATION
You’ll submit all your relevant loan documents

3. REVIEW
The broker undertakes a review of your application

4. PROCESSING
The broker then sends your application to the lender

5. APPROVAL
The lender makes their decision on the loan

6. SETTLEMENT
The funds are made available on the loan

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Your deposit will depend largely on what type of loan you go with and the lender, all of which we’ll help you decide. The general rule-of-thumb is between 5-10% for First Home Buyers, and 10% for Property Investors. Obviously the more you save and use as a deposit before purchase will reduce the amount of interest you’ll pay over the life of the loan.

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You can choose to make your home loan repayments on a weekly, fortnightly or monthly basis over the term of your loan. Your repayment amount will take into account the loan’s interest rate, the loan amount and your repayment frequency. Of course, you can also make additional repayments on top of your normal amount.

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Home buyer’s encounter a number of costs on their property journey. It’s important to budget for things such as:

● home loan application fee
● lender’s property valuation cost
● pre-purchase pest inspection
● pre-purchase building inspection
● home loan protection insurance
● conveyancing fees
● strata fees (if purchasing an apartment)
● stamp duty on the final sale

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There are different grant incentives for different states across Australia. Generally, you’re eligible for the First Home Buyer’s grant if you are an Australian citizen or permanent resident, purchasing or building your first home in Australia, and will occupy the property as your ‘principle place of residence’ within 12 months of settlement and living in it continuously for at least 6 of these months. Also keep in mind that if you’re purchasing the property with another person they’ll also need to meet the same criteria.

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Stamp duty is often a significant additional cost when purchasing property. It’s a state government tax and is determined by the property’s selling price. Each state or territory has different criteria for calculating stamp duty. For example, on a $500,000 property purchase, your Stamp Duty could range from between $10k and $25k depending on your state or territory.

More questions? Contact us today!

 

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